Kenyan oil marketers thrive

By MICHAEL KARANJA, NAIROBI, Kenya Dec 10 – As many well established multinational petroleum companies exit the Kenyan market, local marketers now feel they have an opportunity to thrive.

Hass Petroleum Group Chief Executive Issah Sheikh told a news confrence on Thursday that the exit presents a window of opportunity that small companies can exploit.

“Obviously when someone leaves, you look for ways in which as a player, you can fill in the gap by capitalising on customer needs and giving them the best value for their money,” Mr Sheikh said.

He was however quick to add that the exit of big companies did not automatically mean closure of the business (altogether).

Most multinationals sell their stake to another company in the region ensuring the business still exists.

He added the advantage that is presented is a change of management, which takes time to gel and can be then exploited.

“When a company goes out, there is always a change of ownership. If you are aggressive and you understand the market then the opportunities are endless,” he said.

Multinational petroleum marketers such as Chevron (Caltex), Mobil and BP have exited the market only to be taken up by other players.

French oil company Total bought the Chevron business in Kenya while Mobil was taken over by Oil Libya.

Another reason given for the rise of smaller oil marketers in Kenya is the liberalisation of oil market in 2004.

The CEO said this has removed technical inefficiencies paving the way for increased competition in the market.

“Real competition is setting in and we feel that we have what it takes to compete effectively. It has also created a level playing field in the oil business which makes it easier for new entrants to fit in,” he said.

With this in mind, the company plans to invest Sh20 million in tripling its service stations (currently three stations) in Kenya with a keen focus in Nairobi.

“We have plans in the next three months to intensify our service outlets in Kenya because there are opportunities in as far retail is concerned and Kenyans should be able to access fuel at their convenience.”

Also on the cards for Hass are plans to complement its range of oil products by adding a consumer range of liquefied petroleum gas (LPG) to its stable by mid 2010 even though it already supplies LPG in bulk.

Mr Sheikh was speaking during the unveiling of a new range of lubricants as part of the group’s efforts to reinforce its presence in East Africa and Great Lakes Region markets.

He revealed the company had made a strategic decision to invest in its own range of lubricants blended locally.

The lubricants are formulated with advanced technology to suit the requirements of modern diesel and petrol engines applicable to all conditions to ensure optimal engine performance.

The lubricant brands are Toperx and Atroil for diesel and petrol engines, respectively. Other products unveiled include high grade engine oils, normal grade engine oils and gear lubricants.

Hass operates 60 retail stations across East and Central Africa and the company is the sole distributors of the Abu Dhabi National Oil Company (ADNOC) products in the region.

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MICHAEL KARANJA Michael is a Business Reporter. He is a graduate of Daystar Univeristy with a Degree in Communication (Electronic bias) and a minor in Public Relations. He considers himself easy going and loves engaging